NEW YORK (AP) — The director of market intelligence at an investor relations firm was arrested on insider trading charges Tuesday and accused of using drafts of press releases to illegally earn nearly a million dollars.
Michael Lucarelli, 51, was a director at Manhattan-based Lippert/Heilshorn & Associates Inc. when he made the illegal trades over the last year, prosecutors said as they announced 13 securities fraud charges.
Lucarelli, wearing a tank top, slacks and sandals, was released on $500,000 bail after an initial appearance in federal court in Manhattan.
His attorney, Oscar Michelen, said in court that his client pleads not guilty. Outside court, Michelen said he would not comment on the charges until he can investigate them and speak with Lucarelli.
A magistrate judge ordered strict pretrial drug testing after a prosecutor said unidentified white powder was found when he was arrested at his Manhattan residence. As he left the courthouse, Lucarelli ran out of his sandals and left them behind as he fled photographers.
Authorities said Lucarelli made multiple illegal trades using information from the working drafts of press releases about upcoming earnings reports that his company prepared for its clients. They said he used four different brokerage accounts to carry out the trades, although two of the accounts were suspended in March by a brokerage firm that was not identified in court papers.
Prosecutors said he made more than $500,000 illegally by making trades in the securities of 13 of the firm's clients, while the Securities and Exchange Commission said in a civil complaint that his illicit earnings topped $950,000.
"Despite the well-known parade of convicted insider trading perpetrators over the past several years, Michael Lucarelli was not deterred and violated both his company's policies and his responsibility to its clients," U.S. Attorney Preet Bharara said in a release.
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